 | ||||||||||||||
| ||||||||||||||
Artificial intelligence has been the dominant market narrative for nearly two years, driving much of the stock market's gains during this period. While the enthusiasm around AI may seem to be waning, the progress in developing large language models remains truly remarkable. Just last month, OpenAI unveiled its newest model, o3, which some experts believe may have reached the threshold of Artificial General Intelligence (AGI) based on certain metrics. Though the claim of achieving AGI is debated among researchers, there is no denying the immense power of the latest model. Moreover, the pace of advancements appears to be accelerating. However, what is also increasing rapidly are the costs, with the computational and energy demands of cutting-edge AI models reaching unprecedented levels. To sustain this breakneck pace of progress, the industry will require an explosion in capital investment, potentially growing tenfold or more. Morgan Stanley estimates that the four largest US tech companies will spend as much as $300 billion this year alone to build out their AI infrastructure. This surge in funding will primarily benefit three sectors: semiconductors, particularly GPUs and custom silicon; data centers and the companies that service them; and energy and power supply infrastructure, particularly the leading-edge companies. While AI will eventually transform all industries, these three sectors are poised to be the most significant beneficiaries in the near term. OpenAI's Recent Breakthrough Last month, OpenAI's o3 model set records on the Abstraction and Reasoning Corpus for Artificial General Intelligence (ARC-AGI), scoring 87.5% and outperforming the previous best AI system's score of 55.5%. The ARC-AGI benchmark is significant because it evaluates a system's ability to reason and solve problems in ways akin to human thought—an essential component of achieving true AGI. While debates about the precise definition of AGI continue, o3's achievements demonstrate significant strides toward machines that can reason, learn, and generalize like humans. Although this sounds rather technical, the implications are straightforward and quite significant. OpenAI's o3 model showcases the growing ability of AI to handle tasks that previously required human-level reasoning, creativity, and problem-solving. Notably, o3 demonstrated impressive performance on other benchmarks, including the extremely challenging FrontierMath test, which assesses mathematical reasoning at a level previously thought to be beyond AI capabilities. Its ability to excel across such varied and demanding tasks highlights the potential for this technology to address a wide range of real-world problems. OpenAI founder Sam Altman says the company is focused on developing AI with superintelligence—a machine that surpasses human intelligence in all aspects, including problem-solving, reasoning, and creativity. While this lofty goal may be years away, Altman believes that 2025 will be the year AI agents "join the workforce." The Industries That Will Lead the Boom Although the software output of large language models is simple and straightforward, the infrastructure needed to run, host, and power the technology is vast, complex, and unprecedented. The extraordinary computational demands of advanced AI systems like o3 are driving growth in three key sectors:
Keep reading . . . | ||||||||||||||
| ||||||||||||||
| How to Trade the Next AI Bull Run While the entire technology sector has benefited from AI enthusiasm, investors should consider multiple approaches to capture this trend, from broad market exposure to targeted sector investments. Here's a strategic approach to positioning your portfolio:
The AI Boom Will Continue to Push Stocks Higher The current AI infrastructure buildout represents a fundamental reshaping of the global economy that will drive stock market gains for years to come. The projected $300 billion in AI infrastructure spending by major tech companies this year alone rivals government stimulus packages in scale, creating powerful economic ripple effects across multiple sectors. This massive private investment will accelerate job creation, boost demand for raw materials, and spawn entirely new supporting industries. The AI boom has become self-reinforcing as companies across all sectors are forced to invest in AI capabilities to remain competitive. Early adopters are already seeing productivity gains, compelling their competitors to match or exceed these investments. This competitive dynamic ensures sustained capital flows into AI infrastructure, regardless of broader market conditions. Moreover, the strategic importance of AI has sparked an intensifying global race for technological supremacy. This competition between nations will continue driving innovation and investment, providing a long-term tailwind for AI-focused stocks. In the current phase of the AI revolution, the clearest investment opportunities are in companies building and maintaining the critical infrastructure – semiconductor manufacturers, data center operators, and power infrastructure firms. While picking winners among AI application developers remains more challenging at this stage, the next phase of the AI boom will produce standout companies that successfully monetize AI applications across various industries. Position Your Portfolio to Profit There's no question AI will drive stock market gains in 2025 and for years to come. In this article, we've discussed several few of the angles you can use to target substantial returns. But how do you find the very best stocks to buy, especially when the space moves so quickly? Today, I'm pleased to offer you full 30-day, real-time access to every stock and ETF we're recommending as part of our celebrated Zacks Ultimate service. Our expert-led recommendation services are designed to highlight the most promising stocks on the market, including the hottest AI firms. When you start your trial, you'll gain instant access to TAZR Trader, which has been on the cutting edge of the AI boom since the beginning. The portfolio started recommending Nvidia back in 2017! You'll also be able to follow Technology Innovators, which covers every aspect of the AI ecosystem and tech sector, and Alternative Energy Innovators, showcasing the companies delivering the unprecedented amount of power AI needs to operate. In addition to in-depth coverage of AI developments, you'll also get real-time buys and sells from all of Zacks' portfolio services, including positive earnings surprises, Warren Buffett-style value picks, options trades, and more. These portfolios closed 256 double and triple-digit gains this year alone. While not all our picks are winners, members saw recent gains of +263%... 812%... and even +1,340%.¹ Your cost for all this is only $1, and there's not 1 cent of obligation to spend anything more. Free Bonus: You'll also receive our Special Report, Presidential Profits: 6 Stocks to Ride Under The New Administration. This urgent report examines President Trump's policies and reveals a handful of prime stocks that could soar as the market responds to the new administration. Your opportunity ends at midnight Sunday, January 26. Gain Zacks Ultimate Access Now for Just $1 » Good Investing,
Ethan Feller is a Zacks Strategist with special interest in portfolio analysis. He invites you to access our Zacks Ultimate program and follow all our real-time buys & sells for 30 days. Only $1. | ||||||||||||||
 | ||||||||||||||
| ¹ The results listed above are not (or may not be) representative of the performance of all selections made by Zacks Investment Research's newsletter editors and may represent the partial close of a position. Access grants you a comprehensive list of all open and closed trades. This free resource is being sent by Zacks.com. We look for investment resources and inform you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms of Service". https://www.zacks.com/terms_of_service Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research is not a licensed securities dealer, broker or U.S. investment adviser or investment bank. The Zacks #1 Rank Performance covers the period beginning on January 1, 1988 through December 30, 2024. The performance is the equal weighted performance of a hypothetical portfolio consisting of stocks with a Zacks Rank of #1 that was rebalanced monthly from January 1988 through December 2013 and weekly from 12/31/13 through Monday's open on December 30, 2024. For each stock with a Zacks Rank #1 at the beginning of the month, the total return during the month was calculated as the % change in the price of the stock from the closing price of the prior month to the closing price of the current month plus any dividends received during the month. The monthly individual stock returns were then averaged to determine the portfolio return for the month. For each stock with a Zacks Rank #1 at the beginning of the week, the total return during the week was calculated as the % change in the price of the stock from the opening price for the week to the opening price of the next week plus any dividends received during the week. The weekly individual stock returns were then averaged to determine the portfolio return for the week. If no month-end price or week end open price was available for a stock, it was not included in the portfolio return for the month or the week. The monthly and weekly returns were compounded to arrive at the annual returns. The annualized return is the annual return that, had it been achieved in each year or portion of a year, would have compounded to create the total return over the full time period. These returns are based on the list of Zacks Rank #1 Stocks that was available to clients of Zacks as of the beginning of the month, when returns were calculated monthly, or as of the beginning of the week when returns were calculated weekly. These returns are higher than the returns an investor could achieve investing real money in a portfolio of Zacks Rank #1 stocks because the returns of the hypothetical Zacks Rank #1 portfolio exclude a number of costs, including commissions incurred for trading, the average bid ask spread, the price impact of the trading and, prior to 2013, in those months when the end of the month fell on Friday, Saturday or Sunday, the overnight return from the month end close to the open on the next trading day. The S&P 500 is an unmanaged index. Visit www.zacks.com/performance_disclosure for information about the performance numbers displayed above. Zacks Emails Zacks Investment Research |
Sabtu, 25 Januari 2025
The AI Boom Continues: Key Sectors to Buy Now
Langganan:
Posting Komentar (Atom)
Tidak ada komentar:
Posting Komentar